After a great day out on Sydney harbour , I thought I would share a few nuggets that wealth reporter Andrew Hobbs shared in the article on retirement in the afr
Create a set of balanced goals based on what you need to live a long, happy and fulfilled life.
You need to think about things like survival, lifelong learning, legacy and fulfilment.”
Here are Some things that come to mind when I think retirement
travel, renovations, healthcare, home maintenance ,new car once every five years, golf, eat out twice a week, support some charities, assist the grandchildren with their education and of course - leave something for the next generation when the time comes, an accommodation bond for a retirement home.
Have you got enough to pay for these things?
How long our savings will last?
What annual income our retirement savings will produce.”
Prepare a Budget
Planning to ensure you will have enough money available to be able to afford your way of life.
If you are spending more than you budgeted for, consider cutting your spending.
Prepare a budget to ensure that your income from investments and capital available are adequate to take care of your needs.
Your own home
Buy your home early - pay off debts by 50 and divert mortgage repayments into super
Your home can also be a good source of the funding you need to pay for the accommodation bonds you may need on retirement .
The home you live in is not included in any of the assets tests for government benefits such as the pension or health care card.
It can also provide a source of income through products such as reverse mortgages, which allow you to withdraw income against the capital appreciation of your home.
“More and more Australians are retiring with debt; three-quarters of retirees with a mortgage owe more than they have in superannuation. Aim to clear debt, or minimise it at least.”
OR
Buy investment properties over course of working life - rent vest
Don’t reduce debt
Debt stays same and property increases
Use leverage to create wealth
Massive negative gearing benefits - taxman pays much of your mortgages - but on sale - you’re up for capital gains tax
And your assets become part of your pension test
At retirement - sell a few properties to pay off balance of Mortgages
Not having your own home , security of tenure - you could be given notice to vacate
Where to invest your money at retirement ?
Be sure to invest in “inflation-insured assets”. These could include things like investment properties or share portfolio which offer a yield but also tend to rise in value at or above inflation.
Other assets to consider include inflation-protected bonds, which pay a guaranteed yield above whatever the inflation rate is, or annuities.
A great financial planner is a massive asset to you
Consider estate planning
Ensure your accountant, lawyer and financial planner know your wishes
Simplify
Family companies and trusts may be useful during one’s working life but may not be relevant after retirement.
Have a great financial planner, lawyer , mortgage broker and accountant you can trust !! -
Let me know if I can refer you to these humans on referron ;)
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